Electricity consumption in the global information and communications technology (ICT) industry is growing rapidly. Analyzing reported data on electricity sources and consumption from 113 ICT companies in the U.S., National Renewable Energy Laboratory (NREL) researchers found those companies used more than 59 million MWh of electrical energy in 2014 – 1.5 percent of that consumed in the entire nation.
Electricity produced by renewable energy generation assets sourced voluntarily by those ICT companies accounted for 14 percent (8.3 million Mwh) of their overall consumption. Power purchase agreements (PPAs), on-site generation, “green” power products offered by utilities and renewable energy certificates (RECs) figure prominently in the mix of financial mechanisms ICT companies are using as they increase their reliance on renewable as opposed to fossil fuel energy resources.
“The potential demand for renewable electricity by the ICT sector could grow substantially as financial and social incentives encourage a larger share of ICT companies to purchase renewable electricity and prompt companies already purchasing to increase their commitments,” according to the NREL report Renewable Electricity Use by the U.S. Information and Communication Technology (ICT) Industry.
Renewables Rise among US ICT Leaders
Eliminating much, if not all, of the uncertainty – and hence risks and overall costs – of purchasing and burning coal, natural gas, oil and derivative fossil fuels confers a big advantage on solar, wind and other renewable energy sources, as they require none.
“A number of factors are likely playing a role in the growth of renewable procurement across the ICT sector,” Jenny Heeter, NREL Strategic Energy Analysis Center senior energy analyst and report co-author, said in an interview. “For some companies, procuring renewables may be a cost-effective means of sourcing electricity. For many others, renewables may address one or more components of their organization’s corporate sustainability efforts.”
There are other means by which ICT companies are reducing their emissions, pollution and the degrading effects their operations have on environmental and human health and safety. In addition to increasing renewable energy use, co-location of data centers and use of more energy efficient equipment have likely shaved points off the growth rate of electricity consumption for the 113 US ICT companies covered in NREL’s report.
Construction of net-zero emissions and highly energy efficient data centers is another industry trend that holds substantial promise in terms of reducing power consumption and complementing growing renewable energy use among key ICT industry players – a list that includes AMD, Apple, Google, Intel, Salesforce, Sony, Verizon and Yahoo.
Pressure from environmental and public interest groups is contributing to growing renewable energy use in the ICT sector. Greenpeace looked to raise public pressure on key ICT industry players to clean up their act regarding energy sources and usage with the June 10 release of the “Click Clean Scorecard.”
An ICT Renewables Forecast
Expanding its groundbreaking clean energy research and public advocacy, in a supplement Greenpeace assessed and ranked 110 of the world’s largest websites and their publishers on their overall and renewable energy use, reporting, disclosure and advocacy. In addition, Greenpeace launched a Google Chrome extension that for the first time enables Web users to see a Click Clean report card for the website and its publisher upon accessing the site.
ICT industry players have pointed out that substantial obstacles remain. Prominent among them are the difficulties NREL report authors cite in arranging financing and lengthy, cumbersome and uncoordinated bureaucratic procedures – the so-called “soft” costs of installing renewable energy production capacity.
Looking out to 2020, NREL expects the 113 US ICT companies in its sample could procure 18.5 million MWh to more than 37 million MWh of renewable electricity. That would represent 31 percent and 48 percent increases from 2014 depending on the actual growth rate of renewable electricity procurement in the ICT sector and underlying growth in overall electricity consumption.
“Future use of renewable energy by colocation providers could be a big market driver,” Heeter said “Many other sectors, whether in healthcare or banking, have growing ICT needs. To the extent that co-location providers can help facilitate renewable investments on behalf of those companies, that would create additional growth.”
Heeter added that NREL is also seeing a rapidly growing number of companies set targets for renewable energy use.
NREL expects the report, which is NREL’s initial research and analysis based on aggregated ICT industry data, will serve as a benchmark for future research efforts, as well as serve as a catalyst for more ICT companies to undertake similar efforts inside their own organizations and incorporate them in their environmental and energy reporting.
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